Proposed class-action suit against Shoppers and Loblaw claims terminated owners were berated and ‘perp walked’ out of their stores

A proposed class-action lawsuit against Shoppers Drug Mart Inc. and its parent company Loblaw Companies Limited alleges a range of questionable practices by the major drugstore chain, including having terminated franchisees “perp walked” out of their stores, public shaming of associates who don’t meet performance targets and mandated use of a proprietary computer system prone to glitches when processing prescriptions.“Associate-owners are often berated and insulted by SDM (Shoppers Drug Mart) management, humiliated in front of their staff and colleagues, and ‘perp walked’ out of their Shoppers pharmacies,” states the claim, which was filed on April 11 with the Ontario Superior Court of Justice on behalf of Beamsville, Ont., pharmacist Sivajanan Sivapalan and Sivajanan Pharmaceuticals Limited, the corporation he owns. According to the claim, Shoppers has “arbitrarily and capriciously” terminated franchisees’ agreements after these associate-owners complained about corporate practices they believed were contrary to professional standards and risked patient safety. The claim also states that Shoppers has also made “frivolous and vexatious” reports to the Ontario College of Pharmacists (OCP) about associate-owners after their franchise agreements were terminated.The claim also alleges that somewhere around the time Loblaw acquired Shoppers—a transaction completed in early 2014—the company started imposing quotas on the volume of medication reviews, vaccinations and minor ailments assessment and prescribing.Sivapalan has asked the court to certify the lawsuit as a class action covering former franchise owners whose agreements have been terminated since 2014, as well as current franchise owners in Ontario. According to the claim, Shoppers and Loblaw breached their franchise agreement with these current and former franchise owners, and failed to act fairly and in good faith.The claim has been neither tested nor certified in court. It could take a few years to get the claim certified as a class proceeding, said Andrea Sanche, one of the two health and regulatory lawyers at Toronto-based Ricketts Harris LLP representing Sivapalan.Read: Quotas in pharmacy: Initial survey findings in Saskatchewan are 'aligned' with Ontario's results A Loblaw spokesperson said in an email to Pharmacy Practice + Business that the company believes the case “has no merit whatsoever, and we do intend to vigorously defend it. In the meantime, our collective focus will continue to be on the health and well-being of patients and working with our teams to ensure we take a collaborative approach to patient care and outcomes, both of which includes the delivery of vital professional services such as medication reviews.”Aly Háji, co-counsel for Sivapalan, said the most contentious claim in the suit is the one around professional judgment, professional autonomy, conflicts of interest “and this idea that these corporate practices implemented by Shoppers Drug Mart prevent pharmacists from practicing within their ethical duties and their professional obligations, and that that is grounds for termination under the contract under their franchise agreement.”The lawsuit also alleges other grounds for breach of contract and duties, including Shoppers minimizing support staff hours as well as the company’s alleged failure to provide associate-owners with guidance and support in their dealing with the OCP.In particular, stated the claim, Shoppers failed to guide associate-owners on the operations of their pharmacies in relation to the OCP’s zero-tolerance policy on corporate policies that impede pharmacists’ ability to provide safe and effective patient care.That policy was the result of an OCP survey that found seven in 10 pharmacists had experienced some type of pressure from their employer to do more clinical services. A large majority of these pharmacists worked at a Shoppers Drug Mart pharmacy and cited medication reviews as the primary driver of corporate pressure.“The zero-tolerance policy puts associate-owners at increased risk of regulatory scrutiny and sanction for professional misconduct with respect to the corporate practices,” stated the claim. “SDM did not respond to the zero tolerance policy . . .. Instead, SDM attempted to reframe the corporate practices such that associate-owners, and not SDM, would be liable to the OCP under the zero tolerance policy.”Sivapalan, who first became a Shoppers franchisee and associate-owner in 2012, had his franchise agreement renewed in 2014, 2017 and 2020. According to the claim, he expressed his concerns to Shoppers about the company’s corporate practices. On Jan. 24, 2023, Sivapalan was told his franchise had been terminated, according to the claim, but he was given no reason for the decision.Read: 'Counsel has been retained': Ontario college takes zero-tolerance stance against corporate pressure on pharmacists“(Sivapalan) was repeatedly harassed and humiliated in front of his staff while completing his duties in transitioning ownership of the pharmacy during the notice period,” stated the claim.“When he got terminated, his world sort of shattered,” said Háji, who earned a pharmacy degree from the University of Toronto before moving into law. “I mean (Sivapalan) lost his livelihood, he wasn't able to pay his mortgage, he has two small children. The impact this has on the people involved is something that’s easy to overlook because we focus on professional standards. But really underlying this are people who have lost their careers, their livelihoods, the goodwill in their businesses. That’s really the heartbreaking part of this.”Háji said the response to the lawsuit has been “overwhelming,” with more pharmacists stepping forward to tell their stories.“My social media has been flooded with inquiries,” he said. “I’ve gotten calls and emails and a lot of engagement. A lot of people want to tell their stories—they want to say ‘this is how it impacted me and this is how I suffered because of it.’”Read: 'It happens frequently': What you need to know about the abuse of pharmacists by patients

Proposed class-action suit against Shoppers and Loblaw claims terminated owners were berated and ‘perp walked’ out of their stores

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